Shop and Establishment License Overview

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Lasya Pamidi

Legal
License
Shop and establishment Act
Shop and Establishment License
Last updated on April 30th, 2021

What is a Shop and Establishment License?

Shop and Establishment License refers to a Certificate or License issued to the business, professions, and trade registered under the provisions Shop and Establishment Act. All the rules and regulations of this Act are governed and administered by the Department of Labour.

This License is a requirement when an entity or a business employs people as full -time employees, casual workers, contract workers, etc., to regulate and administer the working conditions and also to protect their rights. People also refer to it as the Shop License.

Furthermore, the applicant must obtain the license within a period of 30 days starting from the day of commencement of work. The validity of a Shop License is for one year, and the same can be renewed every year. However, the rules and regulations concerning renewal vary from one state to another state.

What is the definition of “shop” under the Shop & Establishment Act?

“Shop” under this act refers to any premises where goods are sold either by retail or wholesale. It even includes a places such as where the services are rendered to customers and includes an office, a store-room, godown, warehouse or workhouse or workplace; whether in the same premises or otherwise, used in or in connection with such trade or business but does not include a factory or a commercial establishment.

What is the definition of “Establishment” under the Shop & Establishment Act?

A shop, a commercial establishment, residential hotel, restaurant, eating-house, theatre or other places of public amusement or entertainment to which this Act applies and includes such other establishment as Government may, by notification in the Official Gazette, declare to be an establishment for the purpose of this Act.

Objectives of Shop Act

Benefits of Shop and Establishment License

Who all are eligible to obtain Shop Registration in India?

The following entities are eligible to obtain the license:

Why does a shop or establishment need registration under this Act?

What is regulated under this Act?

The following aspects are regulated under Shop and Establishment License:

FAQs

What documents are maintained under this Act?

The documents and records that are mandatorily maintained under this Act are documents such as Employment Register, Details of the Fine imposed, Advances Issued, Salary Details, Salary Deduction Details, and Holiday’s awarded.

Is it obligatory to take prior approval from the Labour Department?

Yes, every business registered under the provisions of the Shop and Establishment Act needs to take prior approval from the labour department before commencing its business affairs and operations.

Is it mandatory to obtain Registration under the Shop and Establishment Act?

Yes, every business, shop, and establishment needs to obtain registration under the Shop and Establishment Act within a period of 30 days from the date of commencement of operations.

What is the objective of the Shop and Establishment Act?

The primary objective of this act is to provide uniform privileges and benefits for all employees working in different establishments, shops, commercial places, residential hotels, restaurants, theatres and so on.

Got Questions? Ask Away!

  1. Trade License is a license or permission issued by a municipal corporation granting permission to carry on a particular business at a particular address. It ensures that the citizens are not adversely affected by health hazard and nuisance by the improper carrying of trade.